Seeking Alpha
Biotech, foreign companies, China
Profile| Send Message|
( followers)  

Sinopharm Group (HK: 1099) will pay $198 million for a 60% stake of two units belonging to Le Ren Tang, a drug distributor and retailer with a 30% share in the Hebei market (see story). Le Ren Tang will transfer its distribution business and its stakes in four affiliate companies to Le Ren Tang Medicine Logistic, which will now be known as Sinopharm Group Le Ren Tang.

Sichuan Kelun Pharmaceutical (SZ: 002422) will acquire 80% ownership of Guilin Dahua Pharmaceutical Co. Ltd. for $21.9 million (see story). Dahua produces bulk drugs and intermediates.

Golden Meditech Holdings (HK: 801) raised $34.7 million by listing 90 million Depositary Receipts (TSE: 910801) on the Taiwan Stock Exchange (see story). Each unit consists of two shares of Golden Meditech’s Hong Kong-listed stock. Golden Meditech, has its operations in mainland China.

Bohai Pharmaceuticals Group (OTCQB:BOPH) brought in $1.87 million by placing 748,382 unregistered shares of common stock at $2.50 per share, a 23% premium to the previous closing price (see story). Apparently, no M&A activity is planned, as the company said it would use the funds for internal R&D.

Expanding Manufacturing

China National Pharmaceutical Group Corporation (Sinopharm), a state-owned company that is China’s largest producer of pharmaceuticals, will invest $200 million to build a manufacturing facility in Vietnam’s Hoa Lac Hi-Tech Zone, located about 30 km west of Hanoi (see story). The new plant will produce vaccines for the Vietnamese market.

Tianyin Pharmaceutical (NYSEMKT:TPI) completed construction of its Jiangchuan macrolide facility in the Xinjin Industrial Development Area, near Chengdu, China (see story). The company says it expects the plant to add revenues during its 2011 fiscal year. In its Phase I state, the facility is capable of producing up to 240 tons of azithromycin API for domestic and international markets.

Market Forecast

Business Monitor International has increased its short-term forecast for the China pharma market, which includes both pharmaceuticals and TCM products, while it lowered its expectations for the longer term (see story). The business intelligence firm upped its compound annual growth rate for 2009-14 to 16.4%, a jump from 13.8%. But the company lowered its forecast for the size of the 2019 pharmaceutical market in China from $175 billion to $162 billion.

Trials and Approvals

Boston Scientific (NYSE: BSX) has started a China trial of its Promus drug eluting stent (see story). The double-blind test will enroll 500 patients in 15 sites across China. The goal of the trial, which is the first that Boston Scientific has conducted entirely within China, is to gain SFDA approval of the device.

3SBio Inc. (NSDQ: SSRX) was granted SFDA manufacturing approval of an extension of the TPIAO label to include treatment of idiopathic thrombocytopenic purpura (see story). The approval was a long time in the making, as 3SBio originally submitted its application in December 2008. Launched in 2006, TPIAO is a recombinant human thrombopoietin product that was originally approved to treat chemotherapy-induced thrombocytopenia, or platelet deficiency.

Distribution Agreements

First China Pharmaceutical Group (OTCPK:FCPG) will be the exclusive distributor for Esmolol Hydrochloride, a short and rapid-acting beta class II anti-arrhythmic used for temporary control of heart rate and blood pressure (see story). The manufacturer of the drug is Medisan Pharmaceutical Co. Ltd. First China projects initial sales of up to $1 million in its Yunnan Province base, which will grow as the company expands distribution through all of China.

Disclosure: none.

Source: China Biotech Week in Review: Sinopharm's M&A Extends Drug Distribution Network